News

A joint venture between two California-based firms, Dekel Strategic Investors and Arrowroot Real Estate, has purchased Mueller Place, an 86-unit multifamily property in Austin. The new ownership will treat the investment as a value-add opportunity and renovate the unit interiors and property exteriors in an effort to bring rental rates in-line with the submarket. 

Read more here.

On April 3, with little fanfare, the Fed’s Alternative Reference Rate Committee (ARRC) started publishing the Secured Overnight Financing Rate (SOFR) that is slated to replace LIBOR in the US. This is an important first step in the transition away from LIBOR that is scheduled to expire in 2021. It is estimated that the US financial markets have $200 trillion of debt with LIBOR exposure; of this,

In Multifamily Finance, Fannie and Freddie Are Still the Elephant in the Room. Shlomi Ronen emphasized that Congress and the FHFA ought to implement reforms with deliberation, changes that aren’t well explained clearly in advance could startle the market. 

Regardless of where the agencies go from here, a survey of multifamily lending players underscored how high the stakes would be for any major reorganization. Shlomi Ronen, the founder of a Los Angeles debt brokerage that often arranges agency financings,

Dekel Strategic Investors is trading ground-up multifamily deals, where there may be some softness in rental rate growth, for value-add and core-plus strategies. 

Dekel Strategic Investors, a division of Dekel Capital, is shifting its multifamily equity capital strategy to focus on value-add and core-plus deals. The firm is moving away from ground-up development, which it says no longer offers an attractive risk-reward profile.

The new strategy will continue to make small balance equity investments ranging in size from $5 million to $15 million using 65% leverage.

We recently celebrated the grand opening of Sage Desert Assisted Living and Memory Care, a brand new senior living community that is gearing up to help Tucson seniors and their families.

From the Arizona Daily Star:

With its dry climate and cultural attractions, Tucson is proving a strong market for developers of senior living centers. The boom in assisted living facilities that began locally about two years ago continues to draw interest from investors.

Two short months into 2018 we have seen a significant uptick in treasury yields along with positive economic data supporting continued Fed rate hikes for the remainder of the year.  In the CRE lending universe however, the focus has been on has been on increased competition and decreasing credit spreads.

Here we will briefly touch on a couple of catalysts for this credit spread compression,